Political and commercial geology and the world's mineral resources

by Unknown

THE MAJOR NON-FERROUS METALS

Copper.

—The United States stands out predominantly as the world’s great copper producer, producing in 1917 60 per cent. of the world’s output. No other country produces one-sixth as much as the United States. American capital controls (in part through control of refining) 78 per cent. of the world’s production.

Germany has been one of the largest consumers of copper, though not a large producer. Because of this, German interests have in the past secured a considerable control over copper supplies, as well as those of lead, zinc, and other metals, through refining and selling contracts with mining companies. Such control does not as a rule extend to ownership of mines or smelters. Thus for many years companies affiliated with the great German Metal Combine (Metallgeselschaft) were influential in the copper business of the United States. There were three of these companies in the United States, the American Metal Company, L. Vogelstein & Co., and Beer-Sondheimer & Co. Recently the first two have consolidated; and all were Americanized during the war.

The commercial control of the copper in the world, as based on ownership of mines, is, in even figures: United States capital, 69 per cent. (entirely in the Western Hemisphere); British capital, 13 per cent. (in both hemispheres, but mainly in the Eastern); Japanese, 8 per cent. (entirely domestic); German, 6 per cent.; and French, 2 per cent. It will be noted that of the present production three-quarters comes from the Western Hemisphere (North and South America) and only one-quarter from the rest of the world. It is probable that this is a fair index of the relative wealth. The future production of South America will probably increase more rapidly than that of North America, which was earlier developed. It is necessary for the permanent control of the copper situation by the United States that American capital should continue to be foremost in the development of South America.

Lead.

—The United States is the largest producer of lead in the world and has large resources. Next to the United States, in the order named, come Australia, Spain, Germany, and Mexico. Three powers—the United States, British Empire, and Spain—produce 76 per cent. of the total; and of these the United States and Great Britain produce 60 per cent.

The most striking feature about the lead industry is the fact that as the German system of far-reaching commercial control under government auspices—through smelting, refining, and selling—was destroyed, this system was at once adopted by the British and French. In other words, they found that the German plan had been so effective that they not only blocked it permanently so far as their own countries were concerned, but organized similar commercial-political combinations which should not only take care of all their own lead business, but, like the German organization, should reach out into other countries. The German combination still remains active outside the territory of the former Allies.

Of all the great lead-producing powers the United States is the only one which does not possess a government-controlled lead monopoly. Threatened commercial world monopolies of lead, as of other minerals, have therefore, through the revival of nationalistic spirit due to the war, given place to national-commercial monopolies by three powers (Germany, France, and Great Britain), each intended to become as world-wide as possible, and thus competitive with each other and with the purely commercial organizations of the American lead industry. In England this movement has taken the form of a British Metals Corporation (covering not only lead but other metals). The British Treasury is represented on the Board of Directors.

In France, the nationalist movement has resulted in the formation of consortiums or trade monopolies for each industry, organized under government auspices. That of the mineral industry is the Société Minerais et Metaux. The official announcement states that this society is organized under the auspices of the French government, in order to group the French metal producers, operating both at home and abroad, into a co-operative association for the purchase and sale of metallurgical products.

In America, the principal commercial factor is the American Smelting & Refining Co., dominating the market through its control of reduction plants, although it controls directly only one-third the production.

Zinc.

—Zinc and lead are commonly associated in mineral deposits, so that their geological and geographical distribution is nearly identical. Of the world’s production of zinc, the United States produces 35 per cent., Germany 25 per cent., Australia 15 per cent., and Italy 5 per cent.

Up to the outbreak of the war in 1914, the position of zinc was extreme among the metals, in that political control or state sovereignty exercised only a minor effect upon the industry. “Economic factors,” says our author, “made ineffective any control not international in scope. A very large percentage of the zinc ores of the world were transported from the country of production to another for treatment, in some cases even being re-exported.” During the war, however, political control was largely invoked to strengthen and restore commercial control to the chief belligerent nations. This movement was particularly marked in the British Empire, where there now exists, as above noted in the paragraphs discussing lead, a joint political and commercial control. Alien interests were eliminated by government action, and the government retained a share in the control through interests in marketing organizations or financial participation in treatment works.

In the zinc industry, as in that of its closely associated metals, copper and lead, the ownership or control of reduction plants, and more particularly marketing organizations, have been more important in determining commercial control than state sovereignty or commercial ownership of mines. In recent years the marketing organizations became world-wide and completely dominated the industry. The ambition of German commercial interests to control the metal markets and resources of the world was more nearly realized in the case of zinc than of any other metal.

In France, as noted above in the case of lead, a government-controlled metal marketing organization has been formed for the same purpose—protection and advantage in competition. However, British domination of the European zinc industry seems certain. Only the American industry remains untouched by close organization under government auspices. Should Germany lose Silesia, she will probably become a small factor in the zinc industry. With so many doors closed in her face by the British and French political and commercial combinations, there should be governmental precautions taken by the American Government that she should not re-establish herself in the United States, nor so far as possible (following out to its logical conclusion the Monroe Doctrine) in the rest of North and South America.

Note that in the zinc industry, as well as in every other industry, Japan is rapidly expanding, and having reached the limit of her own resources, her field of growth is in Korea, China, and Siberia. Japan’s present zinc-smelting capacity is greater than her domestic consumption, and much greater than the domestic ore supply; and ore is imported from China, Siberia, Indo-China, and Australia.

Tin.

—Tin belongs to a group of minerals that are classifiable together by the fact that they are not of widespread distribution, but are found in really commercial quantity only on a few spots of the globe, and yet are absolutely necessary for our industrial civilization. Such also are chromium, platinum, potash salts, nitrates, and nickel. Of this political-commercial group, tin is an important member. It is noteworthy of this group that the United States is not the lucky holder of the first prize in any of these cases. In the case of chromium, it is mainly the French and British colonies, of platinum it is Russia and Colombia, of potash salts it is Germany, of nitrates it is Chili, of nickel again the British and French colonies, and in the case of tin it is southeastern Asia and Bolivia.

The United States produces less than one-fifth of 1 per cent. of its requirements, and its control of foreign tin resources through mine ownership is negligible. On the other hand, the United States consumes over half the tin of the world, and is the largest manufacturer and distributor of tin products. The tin-mining and smelting industry of the world is dominated by Great Britain.

Tin is used in the manufacture of tin plate, in solder, brass, and many other essential uses, and no satisfactory substitute is available. In war as well as peace, tin cans are as necessary as rifles. Aluminum is the most likely possible substitute for tin in containers, and the United States controls the aluminum industry. About 68 per cent. of the tin is produced at present from southeastern Asia and neighboring islands, 21 per cent. from Bolivia, 4 per cent. from Nigeria and South Africa, and 3 per cent. from England. The Bolivian production will probably tend to increase.

Mercury.

—Mercury, or quicksilver, is a mineral of some importance, although by far not in the class of the last four discussed above. It is useful for drugs and chemicals; as a detonator for high explosives; as a pigment; for treating gold and silver ores; and for many other uses. The greatest quicksilver deposits in the world are in Spain. The United States comes second. The important Idria mine, near Trieste, formerly Austrian, but at last accounts in possession of Italy, takes third place. The production from the rest of the world is small. Spain, Italy, and the United States, therefore, divide the production and the control through state sovereignty. The great mine of Spain, the Almaden (the greatest in the world), is also owned and worked by the Spanish government. The Spanish government contracts, on the basis of competitive proposals, with the successful bidder for the sale of quicksilver for a term of ten years. For a number of successive periods, the contract has been awarded to the Rothschilds of London. By this arrangement the market is controlled in London; and during the war the sale was taken over by the British government. The control of the marketing of the product of this mine enables those in control to fix the price of quicksilver in the world’s markets.

Aluminum.

—An important metal at present, and one bound to be eventually still more important, is aluminum. While one of the principal constituents of all rocks, in the form of silicates, its release from that combination is so difficult that it has not been solved on a commercial scale. Since there is much more aluminum than iron in the earth’s compounds, however, there will never be a shortage, if cost is disregarded. Commercial aluminum is manufactured from the oxide, bauxite. Bauxite is also used directly as an abrasive and also as a refractory. The largest bauxite deposits are controlled politically by the United States and France, with the British Empire in a favorable prospective position. The aluminum works of the world are controlled by Great Britain, France, and Germany, and also Switzerland, Italy, and Norway. The aluminum industry of the United States and Canada is practically in the hands of one company, the Aluminum Company of America, which also holds interests in South America and other countries. The French producers of aluminum have effected a central organization through the incorporation of a selling company, L’Aluminium Française. The British Aluminium Company is the sole producer in England, and controls the Irish deposits.